If a friend is driving my car and has an accident will her insurance cover it if mine has lapsed?

Unfortunately, you are required to ensure your insurance does not lapse.  In terms of whether her insurance could cover your accident, you need to or she needs to check her policy to determine if it covers her vehicle solely or her in any vehicle and if any vehicle, if it would cover the cost of replacement, repairs or fair market value at the time of the accident.

If the insurance does not, your friend may be forced (should you choose to sue) to purchase a new vehicle, though I am sure her defense would be that she was unaware your vehicle had no insurance.

In Colorado, you must have insurance and it looks like you must have additional med-pay insurance (though you can refuse in writing?).  You may wish to check your insurance to verify that they must provide notice to you prior to lapsing or a provision that it automatically should renew.